BOSTON (CBS) – A Rollover IRA allows you to receive distributions from qualified retirement plans such as your 401(k), 403(b), 457, or another IRA and not pay tax on the distribution. You “roll” the money from one qualified account into another.

By rolling over, you’re saving for your future and your money continues to grow tax-deferred. If you don’t roll over your payment, it will be taxable. A big word of caution, be sure you do a trustee to trustee rollover meaning you don’t get the money; the 401(k) provider sends the money to the IRA provider.

If you are in between jobs, your rollover IRA can become a holding place for your retirement money until you decide if you want to transfer the money into your new employer’s plan.

There is no time limit on money held in a rollover IRA. If your new employer does not allow transfers, no sweat! If you change jobs again and the newest employer allows transfers, you can roll it then.

You do not want to “contaminate” the dollars in the Rollover IRA by making a regular IRA contribution to the account. Doing so prevents your ability to rollover that account into a new employer’s retirement plan.

As a general rule of thumb, when you leave a job you are usually better off rolling most employer plans into an IRA and leaving them there. You will have greater flexibility and certainly more choices. The one thing you will not have is the ability to borrow from the IRA as you do from some employer plans and if you rollover a 457 plan you lose the ability to start early distributions.

You can at any time move your IRA account to a different plan provider if you are not happy with your current choices. I would strongly suggest setting up a brokerage IRA so you have some flexibility as to the types of investments available to you.

I would suggest a financial super market type company like a Fidelity or TD Ameritrade that allows you a broad range of choices; stocks, bonds, money market and checking accounts, their own mutual funds, as well as mutual funds from different companies.

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You can hear Dee Lee’s expert financial advice on WBZ NewsRadio 1030 each weekday at 1:55 p.m., 3:55 p.m., and 7:55 p.m.

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